US tariffs reduce to 10%, exporters stay nervous
Times of India
by SIDHARTHAFebruary 25, 2026
AI-Generated Deep Dive Summary
Indian exporters are cautiously optimistic as US tariffs on their goods have been reduced to 10% following a recent announcement by President Donald Trump. The new rate, which took effect on Monday, replaces the previously imposed 25% tariff that had been in place since the start of the month. However, uncertainty remains due to Trump’s history of changing his stance on trade policies. Although he initially hinted at raising tariffs to 15%, the current 10% rate is set under a provision of the Tariff Act of 1974, which allows for such measures only for 150 days.
The decision comes after the US Supreme Court invalidated Trump’s authority to impose reciprocal tariffs. By invoking Section 122 of the Tariff Act, Trump has levied additional 10% duties, citing balance-of-payments issues. This move has created confusion in the trade community, with some shipments being delayed as exporters and US customs officials grapple with the shifting policies.
For many sectors, such as pharmaceuticals and electronics, the reduced tariffs are a welcome relief. These industries had faced higher tariffs under previous measures, which penalized certain goods like those from India’s purchases of Russian oil. However, other sectors like aluminum, steel, and automobiles still face the full 50% tariffs imposed under Section 232. This disparity has left many exporters seeking clarity on how refunds or further adjustments might be processed.
The Gem & Jewellery Export Promotion Council has expressed concern over the lack of clarity regarding diamonds, which were previously treated differently under agreements with the UK and EU. The uncertainty has led some exporters to hold back shipments, wary of potential duty hikes. Despite these challenges, the 10% rate is seen as a significant improvement compared to the previous 25% penalty, making Indian exports more competitive in the US
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Originally published on Times of India on 2/25/2026